A North Carolina law limiting the legal protections of LGBT people has hampered the public universities that drive the state's economic growth, University of North Carolina President Margaret Spellings said Wednesday.

Spellings said recruited candidates have ruled out moving to North Carolina because of the law, and that she's unaware of any academic talent embracing a North Carolina move because of the law called House Bill 2.

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"I know people have withdrawn their candidacy," Spellings told The Associated Press during an interview Wednesday. "But how many? To what effect? Were they not coming anyway? We'll never know."

The state law enacted in one day in March excludes gender identity and sexual orientation from statewide antidiscrimination protections. It also requires transgender people to conform to the sex on their birth certificate when using bathrooms in universities and many other public buildings.

Companies, concerts and conferences have reacted by shunning North Carolina.

A special legislative session last month to repeal HB2 fell apart and the law remains in place. The law's defenders have argued that it is needed to protect people from being molested in bathrooms by men posing as transgender women. New Democratic Gov. Roy Cooper said Monday he continues to discuss repeal with leaders of the Republican-dominated legislature.

"They believe it's had some unintended consequences for the state," said Spellings, who was President George W. Bush's Education Secretary and began leading the 17 public university campuses three weeks before the law passed.

"Obviously the legislature knows what we know. That's why they had a special session. That's why they are trying to come to some solution. That's why the governor and the legislative leaders are apparently talking," she said.

The 220,000-student UNC system is a defendant in a lawsuit filed on behalf of transgender students and university employees. The plaintiffs say requiring them to use restrooms that don't match their gender identity is discriminatory.

Spellings has said the campuses must obey the law, but won't change any policies or enforce the bathroom requirements.

"We're in a competitive world and our competitors have used this issue against us to some extent," she said Wednesday. "If I'm in Georgia and I'm in a competitive bidding war for a world-class faculty member, I'm going to say, if this is a transgender or gay person, 'Is this an environment where you're going to live and work?' So I think anecdotally there's some of that going on."